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Firm A employs 500 units of labour and 500 units of capital to produce 10 units of output. The price of labour and capital to
Firm A employs 500 units of labour and 500 units of capital to produce 10 units of output. The price of labour and capital to produce the 10 units output are $1 and $2 respectively. If the price of labour increased to $2, the total production cost for 10 units of output will be higher than $500. Is this true? A diagram would help. Thank you.
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